Energy stocks pushed US equities higher on November 21. Price of oil went up on the renewed optimism that the OPEC will sign a deal to slash production. Robert Pavlik of Boston Private Wealth echoed the mood of the market when he said that although he has no knowledge of the time of this happening, but hopes that the OPEC deal does happen.
Peak highs seen
Record highs were made for all the three important indexes. All three closed at their peak highs for the first time since summer. The DJIA or Dow Jones Industrial Average went up about 88 points. This crossed previous intraday and closing records ar 18,934.05 and 18,923.06 respectively. The Standard & Poor 500 crossed its record intraday high when it went past 2,193.81 as energy sector gained about 2.2 percent. The previous record was hit on August 15. The record was broken in the middle of day and closed at record highs. There was an advance of 0.89 percent by Nasdaq composite, which also reached peak highs on intraday and closing basis. Peak highs were also enjoyed by the S&P Mid Cap 400 and Russell 2000 indexes. These indexes track mid cap and small stocks respectively. Peter Cardillo of First Standard Financial is of the opinion that commodities and oil are showing stocks the way forward. He also showed that crude prices got a heads up from a weak dollar.
A rise of 3.9 percent is seen in the US crude for the December delivery to settle at about $47.49 for every barrel. There was also a surge of 2.24 percent in US dollar index during the second week of November to the index’s highest level from 2003. It traded only 0.26 percent lower, hovering around 100.9. Randy Frederick of Charles Schwab said that he expects the price of oil to hold within the $40 to $50 for every barrel range. He added that demand is growing and there are plentiful supplies. Deals between OPEC countries would be a shaky one.
Stanley Fischer, the Vice Chairman of the Federal Reserve, said on November 21 that fiscal policy could assist in productivity and help is lowering the burden of economic support on central bank. The possibility of fiscal stimulus is now near certainty when Republican Donald Trump shell shocked the world by taking over the White House. Traders and investors quickly adjusted positions, moving assets into those sectors which will benefit from the fiscal spending.